Microeconomics - Types of Markets Research Paper

Microeconomics - Types of Markets - Research Paper Example In the long run, the firms are ought to make a normal profit and the market price is determined by the forces of demand and supply. However, an important point to note is the situation in the long run equilibrium. If demand increases to a great extent, the price will rise. Therefore, the demand curve will shift upwards causing firms to make supernormal profits. More firms would join the industry and hence, the price will fall again settling at the equilibrium rate. Also, if the average costs are greater than the average revenue then most firms would go out of business. Once the supply curve falls, prices tend to rise. Perfect competition means there should be no imperfections in the market which may arise due to lack of knowledge or immobility of resources. Nonetheless, these factors are unrealistic in this world. One of the important reasons why perfect competition does not exist in the real world is the economies of scale. In most of the industries, a firm has to be quite large to experience economies of scale. But in perfect competition, firms have an insignificant market share and are too small to achieve economies of scale. Once a firm expands and achieves economies of scale, it would lower its costs and gain market power. The firm can reduce the prices and drive out the smaller firms from the industry. Hence a perfect competition can only survive in an industry where there are no economies of scale. Although the perfectly competitive market model is not applicable to the real world setting, it plays a significant role in economic analysis and policy. The model can be used as a criterion to judge the deficiencies of the real world industries and can help the government to articulate policies towards the betterment of the industry. A single industry that produces a product is called a monopoly. This is not it, however, no close substitutes are present and barriers to enter and exit the market are high.  Such barriers include patents, heavy investments, copyrights or achieving economies of a scale comparable to the monopoly.  

Estate Planning Research Paper Example | Topics and Well Written Essays - 1500 words

Estate Planning - Research Paper Example Without a comprehensive estate plan, a significant part of the work you've done throughout your life, both at your job and with your investments, can be lost or given to unintended beneficiaries" (InvestorGuide.com). Estate planning is also important for recipients of social security benefits as "receiving an inheritance may alter his/her social security entitlement. This is particularly prevalent when one member of a couple dies as the survivor is then treated as a single person with lower thresholds under income and assets tests. This means that the levels of assets and income at which the pension starts to reduce and ultimately ceases are reduced which may result in a lower pension or even a complete loss of pension for the beneficiary" (Social security estate planning implications ). Now there are more than one way of planning your estate, especially what to expect after death. The most popular of which is the last will and testament. However, recent developments in finance provides estate planners a better way of handling their estate, that which entails lesser cost, direct or indirect to the heirs: trusts and superannuation. In this particular paper, we will show the many ways in which trust and superannuation supersedes the benefits of the estate planner and their heirs; both through current literatures and through analysis. "A trust is an arrangement under which one person, called a trustee, holds legal title to property for another person, called a beneficiary. You can be the trustee of your own living trust, keeping full control over all property held in trust. A 'living trust' (also called an "inter vivos" trust) is simply a trust you create while you're alive, rather than one that is created at your death" (Nolo). One good thing about living trust is it helps one evade probate, helps reduce taxes and also sets up a long-term property management (Nolo). Trust Versus Will "The Trust owns the legal title to the property in it while you are still alive, and since a Trust does not end at your death, it will still own the property when you die. You put instructions in the Trust for how the Trustee, or person controlling the Trust, should distribute the Trust property, and the Trustee will carry out those directions" (FreeAdvice.com). One important feature about the trust is it can be distributed without necessarily going through the probate process - a "legal process which inherited property goes through in order to transfer the title of the property from the decedent to the beneficiary" (FreeAdvice.com). The main reasons why trusts are advantageous especially for the high net worth individual is it is far less expensive to administer (FreeAdvice.com). On the other hand, "a will is a document that transfers property to others after your death. Because you still own the property at the time you die, all the property transferred in the Will must go through the probate process, which is often slow and costly" (FreeAdvice.com). Below is a summary of the advantages of a trust over a will: Avoid probate - Unlike